Bitcoin experienced some downward pressure following the release of a soft NFP report, affecting growth expectations. However, reassurances from Fed’s Williams helped Bitcoin recover, as he indicated an open-minded approach to the upcoming September meeting.
The market had been positioned for a stronger NFP report, leading to surprise reactions. Currently, 58 bps of easing is anticipated by year-end, compared to the earlier expectation of 35 bps, following the report’s release. The potential for easing and low inflation figures from ISM Manufacturing and UMich reports may support Bitcoin in the future.
The upcoming ISM Services PMI and Jobless Claims data could boost Bitcoin further. A combination of these factors may lead the market to anticipate Fed Chair Powell allowing for a rate cut in September. Bitcoin’s technical analysis on the daily timeframe shows a pullback to the major trendline around the 112,000 level, with buyers positioning for a rally.
On the 4-hour chart, a resistance zone is present around 116,000, with sellers aiming for a break below the trendline. Meanwhile, the 1-hour chart indicates a minor support around 114,000, providing some downside protection. Upcoming catalysts include the ISM Services PMI and Jobless Claims data.
As of today, August 4, 2025, the market is digesting the soft Non-Farm Payrolls report from last week, which we can now see came in at just +155,000 jobs. This initially spooked markets about economic growth, but the focus has quickly shifted. The probability of Fed rate cuts has increased substantially, putting a floor under Bitcoin for now.
We are seeing this reflected in the futures market, with CME FedWatch data now pricing in 58 basis points of cuts by year-end, a significant jump from 35 bps before the report. This sentiment is further supported by the Core PCE inflation data from last month, which showed a cooling trend at 2.6% year-over-year. For traders, this means bad economic news is currently being treated as good news for assets.
This situation feels similar to the market pivot we experienced in late 2023, when expectations of rate cuts began to fuel a significant rally in risk assets. We seem to be in a similar phase where the prospect of looser monetary policy is outweighing immediate growth concerns. The upcoming Jackson Hole Symposium is now a key event where Fed Chair Powell could signal a September cut.
From a derivatives perspective, the major trendline at the $112,000 level has proven to be strong support. Traders could consider selling cash-secured puts or bull put spreads with strike prices below this level to collect premium. This strategy benefits if Bitcoin remains above this key support zone through the coming weeks.
On the other hand, the $116,000 area acts as a clear resistance level. A sustained break above this zone, perhaps driven by a weak ISM Services PMI report tomorrow, could be a signal to initiate long positions. Buying call options or call spreads could be a way to position for a potential rally towards new all-time highs.
However, we must manage risk carefully as a break below the $112,000 trendline could trigger a sharp move down towards $100,000. Protective puts could be used to hedge long positions, especially around key data releases like the jobless claims on Thursday. The market is betting on a soft landing, but a surprise in the data could quickly change that view.
